Newstart Allowance (NSA) is paid to people aged 21 years or over, and under the Age Pension age, who are unemployedand actively searching for work.

To qualify for NSA a person is required to be actively seeking, and willing to undertake, suitable paid work, including casual and part-time work (exemptions apply in certain cases, such as when a person is temporarily incapacitated). A person may also qualify if they are undertaking a course of vocational training, participating in a labour market program, or undertaking other agreed activities.

From 1 July 1998, people aged 18 to 24 years and unemployed for at least six months are required to undertake Mutual Obligation (MO) activities, in addition to their job search. MO requires people to look for work more actively and to take part in activities to improve their skills and work habits. It aims: to enhance unemployed people's job prospects and competitiveness in the labour market; promote their involvement with the community that supports them; and facilitate movement from welfare to work. From 1 July 1999, MO requirements were extended to 25 to 34 year olds who have been receiving unemployment benefits for 12 months or more. From 1 July 2002, MO requirements will be extended to all job seekers aged up to 49 years. Participants are required to undertake Job Search Training after three months of unemployment, another activity after 6 months of unemployment, and annually thereafter.

The rate of payment for NSA depends on several factors, including marital status and income.

Table 7.20 shows the number of recipients of Newstart Allowance at June 2001 and at corresponding points in the preceding three years.

7.20 RECIPIENTS OF NEWSTART ALLOWANCE

Units

June 1998

June 1999

May 2000

June 2001

SHORT-TERM CUSTOMERS (LESS THAN 12 MONTHS)

Age group (years)

Less than 21(a)

no.

62,134

39

28

41

21-34

no.

166,023

136,232

106,866

123,923

35-54

no.

103,087

93,187

80,829

89,770

55-59

no.

13,743

12,834

12,118

12,421

60 and over

no.

6,790

6,941

6,713

6,756

Males

no.

234,551

171,764

143,659

165,451

Females

no.

117,226

77,469

62,895

67,460

Persons

no.

351,777

249,233

206,554

232,911

LONG-TERM CUSTOMERS (12 MONTHS OR LONGER)

Age group (years)

Less than 21(a)

no.

41,082

13,197

2,300

54

21-34

no.

172,208

171,196

155,126

132,545

35-54

no.

162,673

163,224

156,842

145,972

55-59

no.

29,880

28,986

28,205

26,430

60 and over

no.

2,192

3,053

3,852

3,092

Males

no.

289,458

273,366

247,366

222,548

Females

no.

118,577

106,290

98,959

85,545

Persons

no.

408,035

379,656

346,325

308,093

TOTAL CUSTOMERS

Age group (years)

Less than 21(a)

no.

103,216

13,236

2,328

95

21-34

no.

338,231

307,428

261,992

256,468

35-54

no.

265,760

256,411

237,671

235,742

55-59

no.

43,623

41,820

40,323

38,851

60 and over

no.

8,982

9,994

10,565

9,848

Males

no.

524,009

445,130

391,025

387,999

Females

no.

235,803

183,759

161,854

153,005

Persons

no.

759,812

628,889

552,879

541,004

Total payments in financial year ending 30 June(b)

$’000

5,757,731

5,370,669

4,954,450

4,918,349

(a) From 1 July 1998, NSA for 16 to 20 year olds (and certain 15 year olds) was replaced by Youth Allowance (YA). Only those people on NSA or Sickness Allowance who were also aged 18 to 20 years at 17 June 1997 (the date of YA announcement), and remained on NSA at 1 July 1998, were able to continue on NSA. (b) Expenditures prior to 1998-99 were recorded on a cash payments basis and are not directly comparable with expenditures recorded from 1998-99 onwards that are on an accrual basis.

Source: Department of Family and Community Services.

Youth Allowance

On 1 July 1998 the Government introduced Youth Allowance (YA) for young people who are studying, undertaking training, looking for work, or who are temporarily incapacitated. It replaced five payments for young people, namely: Youth Training Allowance, AUSTUDY for students aged 16 to 24 years, Newstart Allowance for the unemployed aged 16 to 20 years, Sickness Allowance for 16 to 20 year olds, and Family Allowance for those secondary students aged 16 and 17 years old who were receiving more than the minimum rate.

YA is now the main income support payment for young unemployed people aged 16 to 20 years, and for full-time students aged from 16 to 24 years. It may also be paid to persons under 16 years of age if exceptional circumstances apply. It can also be paid to young people over 25 where they are continuing a course and were receiving YA immediately prior to turning 25. Since 1 July 1998, YA recipients over 18 years of age who have been unemployed for at least six months, have been required to undertake Mutual Obligation (MO) activities.

In addition to being subject to a personal income and assets test, YA is usually also subject to a parental income and assets test, unless a young person meets the YA independence criteria. To qualify for YA, young people must undertake approved activities, which may include full-time study or a combination of activities such as job search, Work for the Dole, literacy and numeracy courses, part-time education, part-time work or voluntary work. The purpose of this requirement is to help improve a young person's prospects of obtaining employment.

People under 18, who have not completed Year 12 or equivalent, are expected to be in full-time education or training to remain eligible for payment. Exemptions are made for those who are unable to obtain an appropriate training place, have carer responsibilities or are sick, or if other exceptional circumstances apply.

The rate of YA is dependent on whether the person is single or partnered, whether they have children, and whether they live at home or need to live away from home.

Table 7.21 shows the number of recipients of Youth Allowance at June 2001 and at corresponding points in 1999 and 2000.

7.21 RECIPIENTS OF YOUTH ALLOWANCE

Unit

May 1999

June 2000

June 2001

Youth Allowance (full-time students)

no.

303,747

308,883

308,549

Youth Allowance (other)

no.

84,156

83,071

86,404

Total

no.

387,903

391,954

394,953

Total payments for year ending 30 June(a)

$'000

1,843,498

2,002,830

2,101,915

(a) Expenditures from 1998-99 onwards are on an accrual basis.

Source: Department of Family and Community Services.

Austudy

From 1 July 1998, Austudy payment replaced the AUSTUDY living allowance (formerly paid by the Department of Employment, Education, Training and Youth Affairs). Austudy payment is made to students over 25 years of age whose financial circumstances are such that without financial help, full-time study would not be possible. Austudy payment retains most of the features of the old AUSTUDY.

To be eligible for Austudy a person must be undertaking an approved full-time course at an approved institution. Austudy recipients are considered independent and are not subject to a parental income and assets test. However, they are subject to a personal and partner income test.

The rate of Austudy is dependent on whether the person is single or has a partner, whether they have children, and whether the person is a ‘long term income support student’.

Mature Age Allowance

The Mature Age Allowance (MAA)is a non-activity tested income support payment which recognises the labour market difficulties faced by some unemployed people who are close to retirement age.

To qualify for MAA from 1 July 1996, a person must have turned 60 years of age and be less than Age Pension age; have no recent workforce experience (defined as at least 20 hours a week for a total of 13 weeks or more in the previous 12 months); and be an Australian resident and currently residing in Australia. A person must also satisfy one of the following eligibility criteria:

be receiving Newstart Allowance and have been on an income support payment for a continuous period of at least nine months immediately before claiming MAA; or

have received at least one payment of a Social Security pension, Widow Allowance, Partner Allowance, Sickness Allowance, Department of Veterans' Affairs (DVA) service pension, Austudy payment or Parenting Payment (other than non-benefit Parenting Payment (partnered)) at any time within the 13 weeks immediately before claiming; or

have previously received MAA.

Until 1 July 1995, Mature Age Partner Allowance was paid to partners of MAA recipients. This payment is gradually being phased out, with no new grants since that date.

Table 7.22 shows the number of recipients of MAA at June 2001 and at corresponding points in the preceding three years.

Partner Allowance

Since 1 July 1995, Partner Allowance has only been granted to persons born on or before 1 July 1955, who have no dependent children and no recent workforce experience. It is payable to people with partners in receipt of Newstart Allowance, Sickness Allowance, Youth Allowance, Austudy, Special Benefit, Age Pension, Disability Support Pension, Disability Wage Supplement, Mature Age Allowance or a Department of Veterans' Affairs service pension.

Partner Allowance is a non-activity tested payment subject to the income and assets test that applies to other allowances such as NSA.

Table 7.22 shows the number of recipients of Partner Allowance at June 2001 and at corresponding points in the preceding three years.

Widow Allowance

Widow Allowance (WA) is a non-activity tested income support payment. It recognises the labour market difficulties faced by some single older women who may have previously depended on the support of their partner.

WA is available to women over 50 years of age who were widowed, divorced or separated (including separated de facto) after the age of 40. To qualify for WA, a woman must have no recent workforce experience (defined as at least 20 hours a week for a total of 13 weeks or more in the previous 12 months).

WA is paid at the same rate as Newstart Allowance.

WA will be phased out from 1 July 2005, with new grants only to be made to women born on or before 1 July 1955.

Table 7.22 shows the number of recipients of Widow Allowance at June 2001 and at corresponding points in the preceding three years.

7.22 RECIPIENTS OF OTHER LABOUR MARKET RELATED PAYMENTS

Units

June 1998

May 1999

June 2000

June 2001

Mature Age Allowance(a)

no.

55,132

47,360

42,106

39,296

Partner Allowance

no.

77,746

81,804

89,580

92,438

Widow Allowance

no.

24,656

27,822

32,982

36,908

Mature Age Allowance(a)(b)

$’000

443,380

401,698

367,250

352,596

Partner Allowance(b)

$’000

532,278

590,185

646,460

728,679

Widow Allowance(b)

$’000

180,112

227,289

270,825

324,919

(a) Mature Age Allowance includes Mature Age Partner Allowance recipients. (b) Expenditures prior to 1998-99 were recorded on a cash payments basis and are not directly comparable with expenditures recorded from 1998-99 onwards that are on an accrual basis.